Geithner "Out Of The Loop," Resignation Talk Begins

A week ago, we lost patience with Tim Geithner and called for him to be fired. He won't be fired, of course--throwing him under the bus only a month or so into his tenure would embarrass the Obama administration--but we have now heard the first public discussion of a possible resignation.

Why might Tim Geithner resign?

He still has no coherent plan to fix the banking system

He has convinced no one that he's the right man to lead us out of this.

He helped design the past administration's failed bailouts

He was the architect of the original AIG bailout

He tacitly helped cover up the AIG "counterparty" bailout beneficiaries for 6 months

He approved the latest round of AIG bonuses last week (according to AIG)

At the very least, Geithner needs to answer for his role in the original AIG bailout, which has been a disaster, as well as the counterparty cover-up.

In September, Geithner and Hank Paulson engineered an AIG bailout in which Paulson's firm (and one of Geithner's patrons on the New York Fed) secretly received $13 billion of taxpayer money that no taxpayer was told about. Now that taxpayers have found out about it, they are justifiably pissed.

In any event, Republicans have been emboldened by Geithner's stumbles, and they're getting closer to calling for his head:

Huffington Post: Sen. Richard Shelby, ranking Republican on the Banking Committee, charged that Geithner had known about the AIG bonus payments before they were made and failed to stop them...

Shelby said that Geithner "either knew or should have known what was going on. We need to know, what are the details of this? When were the bonuses signed up? Who's getting it?"

The Alabama senator stopped short of calling for Geithner's resignation, saying "he's under fire from all sides now."

"I don't know if he should resign over this," Shelby said. "He works for the president of the United States. But I can tell you, this is just another example of where he seems to be out of the loop. Treasury should have let the American people know about this."